Geopolitical Tension Hits the Financial Markets

The US dollar fell to its low against the basket of major currencies after President Donald Trump wrote some provocative comments on Twitter. Donald Trump told in the social network that he intended to strike at Syria with missiles, even if Russia would shoot them down. “Russia vows to shoot down any and all missiles fired at Syria. Get ready Russia, because they will be coming, nice and new and “smart!” You shouldn’t be partners with a Gas Killing Animal who kills his people and enjoys it!” the president wrote.

It should be recalled, that on April 78, 2018, in Syria in the city of Douma, a chemical attack was carried out, as a result, dozens of people died. The opposition of Syria and the West put the blame for the attack on Syrian President Bashar alAssad and Russia, which supports him. At the moment, investors are concerned that the US may strike at Syria. Russia, in turn, demands the US to abandon the use of missiles.

At the same time, the fall in the US currency was restrained. According to the FOMC minutes, the Fed is going to increase interest rates gradually for several years. Some representatives of the Central Bank believe that it is necessary to accelerate the process of monetary policy tightening. Yesterday, core consumer price index for March was also published, which remained unchanged at 0.2% (monthtomonth). The US dollar index (#DX) closed the trading day with a slight drop (0.07%).

At the moment, the “black gold” prices are growing against the geopolitical tensions. Futures for the WTI crude oil are testing a mark of $67.10 per barrel.

Market Indicators

Yesterday, the bearish sentiment was observed in the US stock market: #SPY (0.52%), #DIA (0.87%), #QQQ (0.58%).

At the moment, the 10year US government bonds yield is at the level of 2.772.78%.

publication of the ECB account on monetary policy at 14:30 (GMT+3:00);import/export price indices in the US at 15:30 (GMT+3:00);the number of initial jobless claims in the US at 15:30 (GMT+3:00).

We also recommend paying attention to the speech of ECB member Coeuré and the governor of the Bank of England Carney.

by JustMarkets, 2018.04.12